Current Property Must-know
The Singapore government has introduced a series of measures popularly known as “Property cooling measures” since 14 September 2009. The main reason for these series of measures is to ensure that Singapore’s property market remains stable and sustainable.
In the beginning, most of these property cooling measures targeted Singapore’s residential segment but since 2013, some of the measures introduced also affected both the industrial and commercial segments. The last measure was announced on 9 December 2013.
This is a summary of the major cooling measures currently in place that are affecting Singapore’s residential segment. Please check with the various government agencies for the full list of measures. Links provided at the end of this page.
1) Total Debt Servicing Ratio – TDSR
With effect from 29 June 2013
See MAS website
The Total Debt Servicing Ratio framework is a rule enforced by the Monetary Authority of Singapore (MAS). Under this rule, any property loan extended by financial institutions must not exceed a TDSR threshold of 60%. This basically means that the percentage of total monthly debt obligations of the borrower to gross monthly income must not exceed 60%.
2) Additional Buyer Stamp Duty – ABSD
Last revised & effective from 12 January 2013
See IRAS website
The ABSD is a tax payable by buyers of residential properties on top of the normal 3% buyer stamp duty that all buyers have to pay. The taxable amount is dependent on the buyer’s citizenship and the number of residential properties that the buyer currently owns. The table below shows the ABSD payable by different categories of buyers.